Karnataka: Ponzi scheme left 17.93 lakh poorer by Rs 3,273 crore

Bengaluru: The CID investigation into several cheating cases by companies that promised investors high interest rates and residential sites for a price lower than the market value has revealed that 10 such companies have conned over 17.93 lakh people to the tune of over Rs 3,273 crore. Now, to help investors get their money back, the CID has recommended to the government to bid the properties belonging to these companies.

CID DGP H.C. Kishore Chandra told the media on Saturday 422 cases were registered at various police stations across the state from 2013 to 2016. “Investigations revealed that 17,93,480 people have invested over Rs 3,273 crore with these 10 companies. These firms offered 5-20 per cent interest per month and offered flats and sites at a lower price than the market value. They had used film personalities and other VIPs in their advertisements in print, electronic and social media. The investors include retired judges, government employees, working professionals, farmers, housewives and even college students,” he said.

“These companies initially delivered what they promised and after getting more investors, they stopped the business abruptly and escaped with the money of the investors. The owners and directors of these firms have used the investors’ money to buy properties, luxury cars and some have invested in film production,” he said.

“It is important in such cases that the investors get their money back. Under Section 3 of the Karnataka Protection of Interest of Depositors in Financial Establishments Act 2004, the CID drawn up a list of immovable properties belonging to three companies and submitted it to the government, recommending it to carry out bidding process of these properties and pay the investors back from the money derived out of bidding. The same procedure will be applicable for the other seven companies and their properties too have been identified. Once the court grants permission, we will write to the government to forfeit the properties,” the DGP said. He said that the investigation was laborious and involved more than 40 officers. He advised the people to not get carried away by the offers promised by some companies and always check the authenticity of such firms before making any investments or deposits.